I'll put my money on what Gary suggested.
Mean while:
Remove the shift mech, peek inside, spin the prop shaft and see if the sliding sleeve is rotating. The gears will not rotate, but the sliding sleeve should.
If you don't want to remove the shift mech, lock the drive in FWD, and try to spin the prop against normal direction.
If you can spin it, then you have an issue with the lower unit not rotating the vertical shaft..... either the lower shaft, or the spline coupler let go, and the lower shaft is not rotating the transmission's vertical shaft.
There is nothing in the transmission that would let go without some major damage...... and you would certainly hear this when the engine is running.
If single prop lower, you have two gears there...... a "drive" gear and a "driven" gear!
The lower unit drive gear may have cracked!
The drive gear/vert shaft splines may have stripped!
Or the vertical shaft coupler may have snapped (some have a cut in them to create a break point).
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